Party City Holdco — Presentation (May 2020)
60 slides from Party City Holdco's investor presentation, May 29, 2020
Slide 1: I.
I.
Slide 2: Slide 2
Slide 3: Disclaimer and forward-looking statements
This document and the information contained herein are being provided by Party City Holdco Inc. and certain of its affiliates (collectively, the “Company” or “Party City”) in connection with the evaluation and negotiation of a potential financial transaction. These materials are preliminary and summ
Slide 4: The Balloon Industry
The Balloon Industry
Slide 5: Foil Balloon Uses
Foil Balloon Uses Aoral add-on toy decoration party gift novalty social expression p.o.p.
Slide 6: Size of the Balloon Market
Size of the Balloon Market Anagram share Retail US & Canada 55 - 60% $ 600 - $ 700 Europe & Middle East 50 - 55% $ 200 - $ 300 Mexico & Latin America 50-60% $ 100 - $ 150 Asia, Japan & Australia 35-50% $ 25 - $ 50 TOTAL 50-55% $925 - $1200
Slide 7: Primary Competitors
Primary Competitors Anagram‰ Gloabal Focus ‰ Exclusive Focus on Foil ‰ Strength with US distributors ‰ Vertical Manufacturing ‰ Innovation in product and merchandising ‰ Broadest Product Offering ‰ Licensing ‰ Retail Merchandising ‰ Quality & Service Pioneer ‰ Global Focus ‰ Primary Focus & Leader i
Slide 8: Global Manufacturers % of Market - 2017
Global Manufacturers % of Market - 2017 Other, 9% Anagram, 55% Pioneer including Bubble, 9% Betallic, 3% CTI,8% Convertidora, 9% Grabo, 3% Flex Metal , 2% TK Innovation, 3%
Slide 9: The Market – Foil vs. Latex
The Market – Foil vs, Latex Manufacturing Retail Channels Merchandising Pricing FOIL FOIL FOIL FOIL • Nonorganic Sheet • Grocery, Party, • Both Inflated & • $.99- $19.00 Material Mass, Drug Non Inflated (inflated) • Flex Printing • Mid-Tier, Specialty • Individual ly Big Box, Street Packaged • Highe
Slide 10: The Market – Air vs. Helium
The Market – Air vs. Helium 90-95% sales helium filled 5- 10% sales air-filled Incremental Opportunity is in air-filled Helium filled balloons requires In Store Labor and limits online competition Air-filled represents online sales opportunities and new retail channels and outlets
Slide 11: Historical Consumer Kids & Social Sentiments
Historical Consumer Kids & Social Sentiments
Slide 12: Anagram's Emerging Consumer
Anagram’s Emerging Consumer Core Consumer 25-35 (Millenial) Female Like to decorate Married Live on social media % share with friends College Educated Like to be inspired Employed want “Pinterest-worthy” items simple to execute They like to celebrate and even make up their own reasons to celebrate!
Slide 13: Who is Anagram?
Who is Anagram?
Slide 14: Who is Anagram? Facts
Who is Anagram? Facts 40 year leader in domestic & international foil ballon market Global industry leader 380 employees 24-7 stand alone operation 250,000 sq. ft. facilities Part of Amsacan/ Party City Family Broadest offering of designs Over 1000 new designs every year 500 custom designs
Slide 15: Global Sales by Channel
Who is Anagram? Global Sales by Channel Intl Affiliate 10% Domestic Distribution 30% Party City 26% Value 11% Custom/Park 4% Mass 4% Intl Distributor 15%
Slide 16: U.S. Sales by Channel
Who is Anagram? U.S. Sales by Channel anagram other 10% grocery 30% party 40% mass 5% value 15% industry other 10% grocery 33% party 30% mass 5% value 22%
Slide 17: Impact of Helium on Anagram Sales
Impact of Helium on Anagram Sales Total Gross Sales LTM Jan 2017- LTM Dec 2019 Shortage Shortage Recession & He Shortage 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Shortage Balance Tight Shortage Balance Surplus Balance Tight Short Tight Balance
Slide 18: US: Go to Market
Who is Anagram? US: Go to Market Manufacturer Mass Distrib. Distributors & Wholesalers Parks, POP, Custom Dollar Store Independent Florist Grocery Party Drug Mass Merchant
Slide 19: International: Go to Market
Who is Anagram? International: Go to Market anagram canada (dist.) europe (affil.) latin america (affil.) asia (dist.) middle east/other (dist.) japan (dist.) australia (affil.) Retailers and Merchandisers anagram
Slide 20: Principles & Values
Who is Anagram? Principles & Values Customer First Results Values DHR Communication Collaboration
Slide 21: Who is Anagram?
Who is Ana otione = ie cose tiny 2 3 Biome tana Sos mart gg prelatiodiianag ers BS B greats Poy coe resources ® &2 Led oul ss la ome SSmet Bi sales challenges “Yate eq key Management consi consuting *S id Dev nt astra > Soria reanzatogl ec Pe bemkeed s ab italents, project ti man: 3p Talentmarhcting
Slide 22: What do we do?
Who is Anagram? What do we do? Anagram makes THE BEST foil balloons EVERY product is put through a rigorous process… Bridging the best in CREATIVITY ENGINEERING SCIENCE
Slide 23: What do we do? Foil focus
Who is Anagram? What do we do? We live foil balloons because we only DO foil balloons! Our focus? To ensure THE BEST foil balloons In the market!
Slide 24: What do we do? Distribution Center
Who is Anagram? What do we do? 120,000 Ft. Distribution Center Sales Customer Service
Slide 25: Why is Anagram? Anagram Brand Video
Why is Anagram? Anagram Brand Video
Slide 26: The Anagram Brand
Who is Anagram? The Anagram Brand Filled with more… to capture those special moments
Slide 27: Why Anagram?
Why Anagram?
Slide 28: Leader in Manufacturing
Why Anagram? Leader in Manufacturing Vertically Integrated Strategic Alliances Experienced Manufacturing Staff
Slide 29: Leader in Service & Quality
Why Anagram? Leader in Service & Quality FOCUSED ON Person FOIL Chain Machine Quality Assurance Method Material
Slide 30: Leader in Safety
Why Anagram? Leader in Safety Extremely robust product safety policies and procedures Partnerships with third party labs in addition to our own in-house safety testing program In House Engineering Team dedicated to quality & Safety Experienced Staff
Slide 31: Leader in Social Responsibility
Why Anagram? Leader in Social Responsibility Supporting Diversity Commitment to a smaller carbon footprint REDUCE REUSE RECYCLE Giving Back
Slide 32: Leader in Retail Development - Grocery
Why Anagram? Leader in Retail Development- Grocery
Slide 33: Leader in Retail Development - Party
Why Anagram? Leader in Retail Development- Party Marketing, Merchandising, Promotions
Slide 34: Leader in Social Media
Why Anagram? Leader in Social Media FACEBOOK 2.2 billion users (364 mil in Europe) 79% of users are between 3.-49 years old Best place for international reach Primary uses: B2B, Decorator Market INSTAGRAM 800 million daily active users 59% of users are between ages 18-29 20% of teens say Instagram i
Slide 35: [Graphic Appears Here]
[Graphic Appears Here]
Slide 36: Leader in Price Points
Why Anagram? Leader in Price Points We sell more products at higher price points Global Mix 7% 34% 27% 32% Retail $ 2.49 – 3.99 $ 1.99 – 3.99 $ 6.99 – 7.99 $ 7.99 – 24.99
Slide 37: Product Innovation Leader
Product Innovation Leader
Slide 38: Leader in Product: Marblez
Why Anagram? Leader in Product Marblez
Slide 39: Leader in Product: Metallic Trimmed Ultrashapes
Why Anagram? Leader in Product Metallic Trimmed Ultrashapes
Slide 40: Leader in Product: Satin Luxe, Infused & Latex
why Anagram? Leader in Product Satin Luxe- Infused & Latex
Slide 41: Inflatable Pinatas
Inflatable Pinatas why Anagram? Leader in Product
Slide 42: Leader in Product: Helium Saving Product
Leader in Product Helium Saving Product Standard Shapes
Slide 43: Leader in Product: Gift Giving Product
Leader in Product Gift Giving Product Concept: Plush Shapes with Matching Balloons (Valentines & Grad Program)
Slide 44: Air Balloonz - 50" Air Filled Shapes
Air Balloonz- 50” Air Filled Shapes -Each has only 2 inflation points ! Why Anagram Leader in Innovatin
Slide 45: Filled With More Opportunity
FILLED WITH MORE OPPORTUNITY
Slide 46: Top Initiatives: New Products, Non-Conductive, Helium
Who is Anagram? Top Initiatives New Products Non- Conductive Helium
Slide 47: Non-Conductive Film Key Attributes & Status
Non-Conductive Film Key Attributes & Status Aesthetics Non-Conductive Barrier Seal Strength Cost Capacity
Slide 48: Anagram Helium Advantage: Balloon Sales Per Tank
Anagram Helium Advantage Balloon Sales Per Tank
Slide 49: Anagram Helium Advantage
Anagram Helium Advantage
Slide 50: Online Balloon Sales
Online Balloon Sales THE WONDER OF BALLONS SHOP NOW Ballons Made Simple Buy online, free in store pick up NEWI Ballons Delivery in select store. Learn more > Balloon Catalog Over 40 pages of inspiratin > DIY Balloon Decor Create custom balloon decor with tutorials amazon try prime
Slide 51: Making a balloon HAPPY BIRTHDAY!
Making a balloon HAPPY BIRTHDAY!
Slide 52: Why Anagram?
Why Anagram? © Tyre y N : anagram — rep rn 7,
Slide 53: Thank You
THANK YOU
Slide 54: II.
II.
Slide 55: Disclaimer and forward-looking statements
This document and the information contained herein are being provided by Party City Holdco Inc. and certain of its affiliates (collectively, the “Company” or “Party City”) in connection with the evaluation and negotiation of a potential financial transaction. These materials are preliminary and summ
Slide 56: PCHI—Select Consolidated Financial Information
PCHI—Select Consolidated Financial Information ($ millions) Forecast 2020F 2021F Q1 Q2 Q3 Q4 FY Total Revenues 414,043 146,825 426,139 673,670 2,186,277 Adjusted EBITDA (12,185) (104,373) 23,914 139,132 268,850 Management anticipates a need of ~$75-100mm to fund operations through year end based on
Slide 57: 2020 Third Party Sales by Division – YOY Revenue Variance
PCHI—Select Consolidated Financial Information 2020 Third Party Sales by Division – YOY Revenue Variance % Variance YOY Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 PCRG -20% -74% -17% -9% -29% Canada Retail Total Big Box Retail -24% -76% -23% -9% -32% NACP -14% -59% -8% -6% -21% International 9% -84% -3
Slide 58: Anagram—Select Financial Information
Anagram—Select Financial Information $ millions Forecast 2020 2021 2022 2023 2024 Net Trade Sales 72 92 102 108 114 Net Sales to Affiliates 56 65 71 75 79 Total Revenue 128 157 173 183 194 Gross Profit 38 47 52 55 58 SG&A 18 20 21 22 23 Operating Income 20 27 31 33 35 Adjusted EBITDA 27 33 37 39 42
Slide 59: PCHI—Select Consolidated Financial Information
PCHI—Select Consolidated Financial Information Actual millions 2018 2018 2018 2018 2019 2019 2019 2019 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Cash and Cash Equivalents 55 51 48 59 39 47 35 35 Accounts Receivable, net of allowances 131 130 171 147 139 140 168 149 Inventories, net of
Slide 60: Anagram—Select Financial Information
Anagram—Select Financial Information $ millions Actual Forecast 2016 2017 2018 2019 2020 2021 2022 2023 2024 Net Trade Sales (1) 98 101 104 96 72 92 102 108 114 Net Sales to Affiliates (1) 52 68 86 57 56 65 71 75 79 Total Revenue 149 170 190 153 128 157 173 183 194 Gross Profit 55 62 64 40 38 47 52